The Competition Swoops In

I stumbled on something from Sun Tzu's The Art of War that seems relevant to Toyota's situation vis à vis its recall problem and how other automakers are already using it to their advantage.

To wit: "The good fighters of old first put themselves beyond the possibility of defeat, and then waited for an opportunity of defeating the enemy."


"To secure ourselves against defeat lies in our own hands, but the opportunity of defeating the enemy is provided by the enemy himself."

Touché. It's unfortunate for Toyota owners that the accelerator-pedal stickiness happened, period, but it's unfortunate for Toyota that if it had to happen, it didn't all happen -- all the warnings, the accidents -- in one fell swoop around January last year. Misery loves company, and that's when the competition wasn't in quite the position it is now to exploit the screw-up. But they are. And they are.

General Motors last week launched incentives aimed at getting some Toyota trade-ins and on Friday Chrysler did likewise, offering current Toyota Tundra, Tacoma and Sienna owners an additional $1,000 trade-in bonus cash with the purchase or lease of any new Chrysler, Jeep, Dodge car or Ram truck through March 1.



How bad things get for the Torrance, Calif.-based Toyota depend, of course, on its response. For some time there wasn't much of a response -- except to hope the problem, like a nagging cough, just went away. And that is unusual for Toyota. Jim Lentz, Toyota's U.S. chief operating officer, has been doing the "mea culpa" (or maybe "we-a culpa") media tour, hitting the TV studios and apologizing and explaining the new fix. The company will probably -- if history predicts these things -- launch some big-time corporate ads explaining how important the U.S. market is ... etc.

But things don't look too good. In a study from Flemington, N.J.-based HCD Research, 56% of 301 viewers who saw a news clip on Toyota's recall said they are not likely to purchase a Toyota.

In the survey, the favorability rating of the Toyota brand declined from an average 4.9 to 3.9 on a scale from 1 to 7, after respondents saw the video. And, per the firm, the percentage of viewers who said they were "somewhat likely" to purchase a Toyota as their next car dropped from 63% before viewing the video to 44% after.

And those respondents watched news clips -- not editorials, not opinions. Such studies say nothing about brand xenophobia, patriotism and other kinds of latent sentimental righteousness or pride that can surface at times like this. All of which puts Toyota behind the eight-ball, another unusual position for it.

As far as the actual problem, I know nothing about keiretsu, the Japanese tight (some say feudal) culture of supplier/OEM relationships, or whether Toyota's accelerator-pedal supplier CTS Corp. fits into that schema. But I do take it as natural law that the larger a company gets, and the greater its reach and product diversity, the more doing Six Sigma gets to be like herding cats. Even Toyota, which pretty much set the bar -- in fact and consumer fancy -- in consistency and quality, has to deal with the relationship between complexity and chaos at some point. Too bad it's now.

But while Toyota has perhaps become too big to sustain the kind of attention to detail and quality with which it is so strongly identified in consumers' minds, I don't necessarily subscribe to the idea that such an edifice can be dashed to bits in an instant by a single mistake. Okay, this wasn't a single mistake, really, but a series of mistakes. But still, I don't think Toyota's rep has suffered a fatal blow. Yes, it has proven subject to the laws of entropy; and it has been taken down a few notches. But it'll survive somehow.

But for now. Well, we all remember the Ford/Firestone fiasco. Jacques Nasser's days at the Blue Oval were numbered. At the time I thought Ford had walked into the field of battle and given Toyota -- at the time expanding its portfolio aggressively into trucks and SUVs -- its shield and spear. Now the gift is Ford's. And GM's, and Chrysler's, Hyundai's, and Honda's ...

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